Helping employees understand health savings accounts
According to research, 65% of HSA holders lacked the knowledge needed to pass a basic fluency test about their accounts.
Fact: HSA funds are a great complement to high-deductible health plans.
To qualify for an HSA, you must be enrolled in an IRS Qualified high-deductible health plan (HDHP).
Employees who also cover their dependents prefer HDHPs because they generally offer lower premiums compared to other health plans. However, the high deductible can make paying for medical care and drugs difficult. This is why it is smart to have an HSA to help fund a Qualified HDHP.
Fact: HSA funds are versatile.
Although you must be enrolled in an HDHP to qualify for an HSA, HSAs do a lot more than pay for expensive deductibles and drugs.
HSA funds can be used to pay for a variety of qualified medical and healthcare-related expenses, including dental, vision and many over-the-counter medications.
HSA funds are NOT “use it or lose it” funds.
Fact: HSAs offer tax advantages.
The contributions are tax-deductible. For 2021, the contribution limit is $3,600 for self-coverage and $7,200 for family coverage. There is an additional $1,000 catch-up contribution for those who are 55 and older.
Tax-free withdrawals when used to cover eligible healthcare-related expenses.
Want to learn more about making HSAs a component of your benefit package? Higginbotham is here for you! Thousands of employers across Texas trust our single-source solution for employee benefits and financial services.
We have more than 30 offices in Texas to serve your employee benefit needs. Our size makes us the largest independent insurance broker in the state, but our local concentration keeps us handy.
Mark Rutherford, Managing Director